CAPACITY TO CONTRACT

PRESENTED BY:VARGHESE T JOHN

Capacity to contract refers to the legal ability of a
person to enter into a valid contract.
According to sec. 11, every person is competent to
enter into a contract if he is of the age of majority, he
is of sound mind, he is not disqualified by any law
from contracting.
1) MINOR – According to Indian Majority Act, 1875 a
person who has not attained the age of 18 is a minor .
Law regarding minor’s agreement:-
1) An agreement by or with a minor is void.
Case:- Mohori Bibi vs. Dharmodas Ghose-
2) Minor is not bound to return the benefits received.
3) A minor cannot ratify his act.
4) Restitution of the property from a minor in case of
fraud.
5) Principle of estoppel is not applicable to minors.
6) A minor is liable for necessaries supplied.
7) Service rendered to a minor.
8) Minor as promisee or beneficiary.
9) Minor as agent.
10) Minor as partner.
11) minor as insolvent
2) PERSONS OF UNSOUND MIND:-
According to sec.12, a person is said to be unsound
mind if he is suffering from permanent or temporary
mental derangement.
A) Idiots- a person who has completely lost his
powers & who is incapable of forming a rational
judgement.
(b) Lunatics – a person whose mental powers are
deranged due to some mental strain. He may suffer
from intervals of sanity & insanity.
(c) Drunken persons – a person who is in a state of
intoxication is capable of entering into contract. Any
contract made during drunkenness is void.
3) PERSONS DISQUALIFIED BY ANY LAW FROM
CONTRACT:-
(a) Foreign sovereigns & ambassadors- they have got a
peculiar privilege that they can enter into contracts &
enforce them in courts.
Case :- Mighell vs. Sulthan of Johore – the sulthan of
johore, living in England under the name of Albert
Baker, had agreed to marry Mighell but he subsequently
refused to marry her. She filed a case against him the
court held that a foreign sovereign cannot be sued.
(b) Alien Enemy – alien means a person who is a
citizen of a foreign country.
(c) corporations – a co. is an artificial person created
by law. It is a legal existence. The powers of the
corporations to contract are limited by its
Memorandum of Associations.
(d) Professionals – in England, a barrister is incapable
of entering into contract & is incapable of suing or
being sued.
(e) Convicts – cannot enter into contract and cannot
sue while they are undergoing arrests.
(f) Insolvent or Bankrupts – when a person has
incurred debts more than his assets & he is not able to
repay the debts he is adjudged insolvent by a
competent court.
(g) Women – In India, a women has got every right to
acquire properties & enter into a contract & her rights
is guaranteed under the Indian Constitution.
THANK YOU.
THANK YOU